Texas is a community property state, which means that a husband and wife own equal shares of anything they acquire during their marriage. If one spouse receives a large inheritance, however, the other spouse does not automatically own half of it.
The exception to the community property rule is the theory of separate property. Courts generally consider an inheritance to be separate property in a divorce unless the inheritance has become commingled with community assets.
What makes an inheritance commingled?
Sometimes, an inheritance mixes with community property in such a way that it becomes difficult to separate. Courts refer to this mixing as ”commingling.” For example, if a spouse deposits his or her inheritance into a joint bank account, and then uses funds from that account for marital expenses, the inheritance becomes commingled. Money is not the only type of inheritance that may become commingled. An inherited house, for example, becomes commingled if a spouse uses community money to pay for things like upkeep or taxes.
How can a spouse keep an inheritance separate?
Under Texas law, courts presume that all a couple’s assets are community property. The spouse who wants to claim an inheritance as separate property must prove that the inheritance was not commingled. A spouse who wants to keep an inheritance separate must be sure to keep accurate records showing that there has been no association between the inheritance and community funds. In the case of inherited real property, he or she must show that he or she paid all property expenses with separate funds.
In theory, an inheritance is the textbook example of separate property. In reality, however, keeping separate property truly separate is a challenging task.